The Health Care Law & You
The Affordable Care Act puts in place strong consumer protections, provides new coverage options and gives you the tools you need to make informed choices about your health. In this section, learn about how the law affects you.
Understanding and Fighting Health Inequalities
To help us all understand and reduce the number of persistent inequalities in health care, U.S. law now requires any ongoing or new federal health program to collect and report racial, ethnic and language data.
The U.S. Secretary of Health and Human Services uses this data to help identify any differences in program benefits to help make equal health care available to all Americans.
Effective March 2012
Medical Loss Ratio Rebate Payments Begin
The Affordable Care Act (ACA) requires individual and group health plans to report publicly their medical loss ratios (MLR), which represent the percentage of each premium dollar spent on health care services and quality improvement. ACA also requires such plans to provide an annual rebate to enrollees if the MLR is below the minimum requirement for the applicable market (80% for individual and small group markets and 85% for the large group market).
The US Department of Health and Human Services (HHS) and the Internal Revenue Service (IRS) have released a series of different forms of guidance regarding the MLR requirements for insurers. One recent rule requires that insurers that met or exceeded MLR in 2011 send notices on or after July 1, 2012 to all customers to inform them of the MLR rebate requirement and advise them that they would not receive a rebate. In total, BCBSNC spent $230 million more on medical care for our members than was required by law.
Effective June 2012
Transparency of Benefits, Coverage and Insurance Terms
Health insurance is a highly complex product that can be difficult for consumers to grasp. Attempting to simplify things, the Affordable Care Act (ACA) required the US Department of Health and Human Services (HHS) to develop a "Summary of Benefits and Coverage" (SBC) and a Uniform Glossary of insurance and medical terms, which are common in the health care system but, confusing for consumers. SBCs can make comparing different health coverage options easier.
The glossary must available to plan participants, in paper or electronic form, within 7 days of request.
The SBC, a much more personalized document, must include plan-specific information, including coverage:
- Description (cost sharing, for each benefit category)
- Exceptions, reductions and limitations
- Cost-sharing provisions (deductible, coinsurance, copayments)
- Renewability and continuation provisions
- Coverage examples (illustrating benefits provided)
Effective September 2012
Health Insurance Marketplaces (aka "Exchanges") Open Enrollment Begins
Health Insurance Marketplaces, required by the Affordable Care Act, give people a new way to shop for the coverage they need.
One of the key goals of the Affordable Care Act (ACA) is to organize the health insurance market through the creation of Health Insurance Marketplaces, called "Exchanges". Exchanges are intended to be transparent and competitive online insurance marketplaces where individuals and small businesses can shop for and buy qualified health benefit plans (QHPs).
Exchanges allow individuals and small groups to easily compare insurance products; provide standardized information about benefits coverage and pricing, and determine eligibility subsidies.
Four levels of plans will be available on the Exchange: bronze, silver, gold and platinum (and a catastrophic plan for individuals under 30 and those meeting financial hardship criteria; and a child only plan).
A QHP is provides essential health benefits and follows established limits on cost-sharing (deductibles, copayments, and coinsurance).
The first Health Care Reform compliant insurance plans are available October 1, 2013 but will not take effect until January 1, 2014.
Medical Device Sales Tax Begins
A 2.3% medical device tax will be implemented on all medical device companies. This tax applies to all medical device sales. The Congressional Budget Office has estimated that, over 10 years, the tax would amount to about $29.1 billion in revenue.
Effective January 1, 2013
FSA Contributions are Restricted to $2,500/year
The Affordable Care Act (ACA) reduces the amount of money you can save in your Flexible Spending Account (FSA) and sets strict rules on how you can use the money you save.
The new rules, and the penalties for improper use, will generate revenues to offset the cost of the health care reform tax credits and other spending.
- The new $2,500 limit was effective for plan years starting January 1 and will rise each year based on the rate of inflation.
- FSAs will continue to be "use-it-or-lose-it" accounts; any portion unused at year end will be forfeited.
- You won't be able to spend FSA dollars on over-the-counter medical supplies not prescribed by a doctor.
Effective January 1, 2013
Promoting Individual Responsibility
Under the Affordable Care Act, most individuals who can afford it will be required to obtain basic health insurance coverage or pay a penalty when they file taxes. These fees will be used to help offset the costs of caring for uninsured Americans.
If affordable coverage is not available to an individual, he or she may be eligible for an exemption.
Effective January 1, 2014
Makes Care More Affordable
Tax credits to help the middle class afford insurance will become available for those with income between 100% and 400% of the poverty line (up to approximately $46,000 for individuals and $94,000 for a family of four) who are ineligible for other affordable coverage.
The tax credit can be spread over the year so it can lower your premium payments each month rather than making you wait for tax time. It's also refundable, so even moderate income families can receive the full benefit of the credit.
Individuals who qualify for these tax credits may also qualify for reduced cost-sharing (copayments, co-insurance and deductibles).
Effective January 1, 2014
Health Care Reform and Essential Health Benefits
The Affordable Care Act (ACA) requires that all health insurance coverage for individuals and small groups includes certain treatments and procedures or "essential health benefits."
The underlying idea is that the essential benefits package be equal to the coverage offered under a typical employer plan, with 10 general categories that include:
- Ambulatory patient services
- Emergency services
- Maternity and newborn care
- Mental health and substance use disorder services, including behavioral health treatment
- Prescription drugs
- Rehabilitative and habilitative services and devices
- Laboratory services
- Preventive, wellness and chronic disease management
- Pediatric services, including oral and vision care
Effective January 2014
Employer Shared Responsibility (Pay or Play)
Regulation requiring businesses with 50 or more employees to offer "affordable" coverage to full-time employees or pay a fine has been delayed from 2014 to 2015.
The Affordable Care Act defines affordable as consuming no more than 9.5% of an employee's income and minimum value is defined as a plan that pays, on average, 60% of the costs. If employers do not offer coverage and at least one full-time equivalent employee receives a tax credit, the penalty is $2,000 per employee. If the employer offers coverage but at least one employee receives a tax credit and the coverage does not meet the definition of affordable, the penalty is the lesser of $2,000 times the total number of employees or $3,000 times the number of employees receiving a credit. While these penalties may seem high to some, most employers pay more than this to provide coverage to their employees each year.
Effective January 2015
If an employer-provided health insurance policy costs more than $10,200 for an individual or $27,500 for a family, the employer will be taxed 40% of what's considered an excess benefit. For retirees and employees with high-risk jobs, the minimum is increased to $11,850 for individuals and $30,950 for families.
Effective January 2018